Limited partnerships are regularly used for collective investment funds, private investment structures and family wealth structuring.
Governed in Jersey by the Limited Partnerships (1994) law they are both flexible and relatively easy to establish.
A limited partnership is a partnership between one or more general partners and one or more limited partners. Critically, the liability of the limited partners is limited to any unpaid commitment whereas the liability of the general partners is unlimited.
Typically a corporate Special Purpose Vehicle is used to act as the general partner and is responsible for the management of the partnership. Whilst the limited partners have economic interest in the partnership they do not take part in its management.
Due to their flexibility limited partnerships are used in a wide variety of situations but typically for :
- Estate planning and asset protection
- Private equity and venture capital schemes
- Real estate development and investment
- Tax and financial planning
Limited partnerships are tax transparent. The partnership itself will not be subject to tax, with the income or losses being treated as those of the individual partners. This enables individual partners to benefit from any applicable tax benefits and reliefs.
Limited partnerships also offer privacy, with no requirement to file details of the names of limited partners or the partnership agreement with the Registrar, and no requirement to file annual returns.
At Highvern our team of experts have many years of experience in the creation and administration of limited partnerships both as stand-alone structures or as part of a wider estate planning solution.